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Stockwatch – Talisman Reports $237M Second Quarter Net Loss

Calgary-based oil and gas company Talisman Energy Inc. (TSE:TLM, Mkt cap 11.73B, P/E – , Div/yield 0.07/2.59, EPS -0.86, Shares 1.04B) has disclosed its financial results for the second quarter of this year, reporting a net loss of $237 million ($0.23 per share), compared to a net profit of $97 million the same period last year. According to the announcement, the loss was mainly due to a $171 million movement concerning cash settlements as well as non-cash mark-to-market loss on commodity derivatives.

What also contributed to the net income loss is Talisman’s lowered credit adjusted discount rate being applied to its asset retirement obligation liabilities across its portfolio by 100 basis points. The move resulted in an after-tax impairment of $50 million in the UK and a further $12 million in Norway.

Quarterly loss from operations amounts to $9 million on a non-GAAP basis, against earnings from operations in the amount of $79 million int the first first quarter. Lower gas prices in North America were the main reason behind the loss.

The company’s net debt for in the second quarter stood at about $ 4.2 billion, rising from around $3.8 billion in the preceding quarter.

Talisman recorded cash flow of $567 million for the second quarter, marking an 8% increase year-over-year and an 8% decrease compared to the previous quarter.

The second quarter saw total production averaging 375,000 barrels of oil equivalent per day (boe/d). This marked an increase of 4% year-over-year. Production from ongoing operations averaged 364,000 boe/d, registering a 12% increase year-over-year and a 3% increase from the first quarter of 2014.

The company’s total revenue reached $1.24 billion in the second quarter, up from $1.2 billion a year ago. But Talisman’s total expenses rose too, hitting 1.4 billion, while for the first quarter they stood at 953 million.

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